PRODUCTION DISTRIBUTION. = Leading regional manufacturer and distributor of FMCG brands

Transcription

1 London, March 27 th 2017

2 PRODUCTION DISTRIBUTION + = Leading regional manufacturer and distributor of FMCG brands

3 18 distribution centres 19 production facilities in 6 countries 40 product presence on over 40 markets 5500 employees on 12 markets Among the leading food and beverage companies in the SEE region Founded in 1991 Listed on the Zagreb Stock Exchange since 2007 MCap (20/03/2017): EUR 405m FY16 sales: EUR 678m FY16 EBITDA: EUR 63m 3

4 Management Board Ownership structure as of March15 th 2017 Emil Tedeschi Founder / President of the Management Board Others 10.5% Croatian pension funds 30.3% Emil Tedeschi 50.2% Mladen Veber Senior Vice President Business Operations Zoran Stanković Vice President Finance Neven Vranković Vice President Corporate Affairs Management 1.2% EBRD 2.0% Lada Tedeschi Fiorio 5.8% ATLANTIC GRUPA - THE BEST MANAGED COMPANY IN st in CROATIA 2 nd in the CEE region 1 st in the FOOD & BEVERAGE sector in the CEE Free float: 44.0% (according to the Zagreb Stock Exchange, free float does not include: treasury shares, shares in sole ownership over 5%, unless they are owned by pension funds) MANAGEMENT TEAM AND OWNERSHIP STRUCTURE 4

5 DISTRIBUTION DISTRIBUTION & PRODUCTION VERTICAL INTEGRATION European company National company Regional company s : Acquisition of DROGA KOLINSKA Growth in Germany and Austria Distribution centres across Croatia Various distribution cooperations Regional expansion 2001: Acquisition of CEDEVITA Several small-size acquisitions 2007: IPO 2005: Acquisition of MULTIPOWER Sales in EURm CAGR : +29.5% * *: Pro-forma consolidated with Droga Kolinska CEDEVITA MULTIPOWER DROGA KOLINSKA HISTORICAL DEVELOPMENT: TRACK RECORD IN VALUE CREATION 5

6 Pro forma cons 2010 Sales, EUR millions % 12.0% 10.0% 8.0% 6.0% 4.0% 2.0% 0.0% 11.8% 11.1% 11.5% 12.0% 11.8% 6.2% 2.8% Pro forma cons % 1.5% Margin overview 8.2% 8.6% 8.7% 10.5% 7.5% 9.3% 6.0% 4.0% 4.2% 4.5% 3.2% 2.3% EBITDA margin EBIT margin Net profit/loss margin Net debt/ebitda ROaE, ROCE Pro forma cons % 12.0% 10.0% 8.0% 6.0% 4.0% 2.0% 0.0% 11.8% 11.3% Pro forma cons % 12.7% 12.5% 9.4% 10.4% 12.7% 12.4% 13.1% 9.8% 7.6% 8.2% 4.7% ROaE ROCE HISTORICAL DEVELOPMENT OF KEY FINANCIAL INDICATORS 6

7 Performance on capital market ATGR-R-A Crobex Crobex10 40% 0% -40% 2.0% 8.0% 6.4% 7.8% 18.1% 17.1% -11.5% -2.9% -1.1% 30.9% -2.7% 34.0% 1.2% 3.1% 2.4% -80% Valuation Last price in reporting period Market capitalization* (in HRK millions) 2, ,777.1 Average daily turnover (in HRK thousands) EV (in HRK millions) 4, ,457.7 EV/EBITDA EV/EBIT EV/sales EPS (in HRK) P/E *Closing price multiplied by the total number of shares PERFORMANCE ON CROATIAN CAPITAL MARKET 7

8 8 PORTFOLIO OVERVIEW 8

9 Market share Barcaffe/ Grand kafa Argeta Smoki Cedevita Value share Croatia 13.2% 12.1% 25.1% 21.4% 18.5% 16.8% 78.5% 77.6% Serbia 52.9% 52.0% 23.6% 20.4% 53.5% 57.6% 72.5% 73.1% Slovenia 77.1% 75.9% 43.6% 39.8% 46.2% 42.0% 86.0% 84.4% B&H % 49.2% 36.1% 40.1% 79.7% 79.3% Source: Nielsen Retail Panel for food and non-food categories, period: June - November 2016 Top 10 - Region Top 5 - Slovenia Top 5 - Croatia Top 5 - Serbia Top 5 - B&H Top 5 - Macedonia 1 Coca Cola 2 Milka 3 Cedevita 4 Vegeta 5 Argeta 6 Smoki 7 Orbit 8 Cockta 9 Nivea 10 Jana Barcaffe Jana Plazma Argeta Argeta Coca Cola Coca Cola Coca Cola Coca Cola Bitolski Cedevita Cedevita Smoki Milka Coca Cola Fructal Vegeta Moja kravica Cedevita Colgate Argeta Jamnica Milka Chipsy Stobi Flips Source: Valicon research 2016 OUR BRANDS 9

10 Source: Valicon research 2016 OUR BRANDS 9

11 INTERNATIONAL REGIONAL LOCAL BRANDS STRUCTURING 10

12 SALES PROFILE

13 Sales by segments 2016 (EUR 678m) Sales by countries 2016 (EUR 678m) Croatia 28.8% 2% 1% Principal brands 21.4% 9% Coffee 20.8% 21% Sweet and salted snacks 12.8% 10% Beverages 12.5% Savoury spreads 10.6% 11% 21% Pharma & Personal care 10.2% Sports and Functional Food 8.8% 12% 13% Baby food 2.3% Gourmet 0.6% 3% 3% 10% 7% 8% 17% 23% 29% Serbia 23.2% Slovenia 16.8% Bosnia and Hercegovina 7.8% Other regional markets* 6.7% Key European markets** 10.1% Russia and CIS 3.7% Other markets 3.0% * Macedonia, Montenegro, Kosovo ** Germany, United Kingdom, Italy, Switzerland, Austria, Sweden, Spain AG BRANDS WITH SALES OVER EUR 15m in 2016 SALES PROFILE 12

14 FINANCIAL OVERVIEW

15 Performance in line with guidance Continued development of business operations in Western European markets Restructuring and reorganization of Sports and Functional food Amended loan conditions and issue of new corporate bond coupled with debt decrease Development of own brands and opening of new pharma locations Risk management and consolidation of IT solutions KEY BUSINESS DEVELOPMENTS IN

16 (in EURm) / 2015 Revenues (4.2%) Sales (4.7%) EBITDA (15.6%) EBIT (23.1%) Net profit (32.1%) Highlights from 2016 results: Results in accordance with expectations with the focus on business internationalisation. Sales growth in almost all regional markets (Croatia, Slovenia, Bosnia and Herzegovina and Macedonia, only drop in Serbia), due both own brands and principal sales growth, which confirmed the position of Atlantic Grupa as a leading distributor in the region. Lower result in Serbia caused by decrease in sales of coffee (caused by drop in overall Turkish coffee category and additional negative impact of the inventory optimisation by the key customer). Decline in sales in Russia and CIS markets primarily due to decrease of purchasing power caused by depreciation of rouble and high inflation rate. The decrease in EBITDA due to decrease in revenues caused by the terminated cooperation with the major buyer of the private label in Sports and Functional Food, and the restructuring of this business unit, as well as higher costs as a result of the targeted investments in the internationalisation of operations. Continuous focus on further deleveraging (net debt decrease of HRK millions or by 10.5%). Decrease of the finance costs by 9.8%. Costs of production materials lower by 8.6%, primarily due to lower prices of raw coffee and lower production in the sports and functional food segment, following the terminated cooperation with the major buyer of the private label. FINANCIAL OVERVIEW IN

17 (EUR 000) / 2015 (EUR million) / 2015 SBU Coffee % SBU Beverages % SBU (Sweet and Salted) Snacks % SBU Savoury Spreads % SBU Pharma and Personal Care SBU Sports and Functional Food % (40.9%) SDU Serbia (5.3%) SDU Croatia % DU Slovenia % SDR Zone West (2.3%) Other segments* (6.2%) Reconciliation** (381.1) (387.4) (1.6%) Sales (4.5%) SBU Coffee % SBU Beverages % SBU (Sweet and Salted) Snacks % SBU Savoury Spreads (0.6%) SBU Pharma and Personal Care SBU Sports and Functional Food % (2.7) (4.3) 36.3% SDU Serbia (33.7%) SDU Croatia (50.5%) DU Slovenia % SDR Zone West (7.3) 1.4 (628.2%) Other segments* (25.8) (17.3) (49.1%) Group EBITDA (15.5%) * Other segments include SDR HoReCa, SDU CIS, BU Baby Food, BU Gourmet, DU Macedonia and business activities not allocated to business and distribution units (headquarters and support functions in Serbia, Slovenia and Macedonia) which are excluded from the reportable operating segments. ** Line item Reconciliation relates to the sale of own brands which is included in the appropriate SBU and BU and in SDUs and DUs through which the products were distributed. PERFORMANCE BY SBUs AND SDUs IN

18 (in EUR millions) /2015 Sales (4.5%) EBITDA (15.5%) EBIT (23.0%) Net profit/(loss) (32.7%) Profitability margins EBITDA margin 9.3% 10.5% -120 bp 20% 6% 37% EBIT margin 6.0% 7.5% -145 bp 4% Net profit margin 3.2% 4.5% -129 bp 12% 21% (in HRK millions) Net debt 1, ,678.1 Total assets 5, ,294.6 Total Equity 2, ,945.3 Current ratio Gearing ratio 42.7% 46.3% Net debt/ebitda Interest coverage ratio Capital expenditure Cash flow from operating activities Capital and reserves 37.4% Long term borrowings 22.7% Short term borrowings 10.9% Bond 3.7% Trade and other payables 19.9% Other liabilities 5.5% FINANCIAL INDICATORS IN

19 STRATEGIC GUIDANCE

20 6,000 5,000 4,000 3,000 2,000 1,000 Sales (HRKm) 93% 103% 99% 102% 99% 98% 98% 102% 100% EBITDA (HRKm) 100% 98% 101% 98% 102% 101% 96% 100% 100% % Reported Guidance EBIT (HRKm) 101% 104% 97% 96% % % 99% Reported Guidance Atlantic Grupa listed on the Zagreb Stock Exchange on November 19 th % % 95% 102% % Sales99% EBITDA Reported EBIT Guidance % Since 2008 Atlantic 104% Grupa publishes guidance for the 399following 385 financial year and delivers it Sales EBITDA EBIT GUIDANCE TRACK RECORD 20

21 Strategic management guidance Focus on: (i) continuing internationalisation of the business (Multipower, Argeta, Donat Mg, Bebi, Cedevita, Granny s Secret), (ii) strengthening the position of regional brands (Cockta, Cedevita, Smoki, Grand Kafa, Barcaffe, Najlepše želje, Chipsos), (iii) active development of the regional HoReCa portfolio, and (iv) finishing of the restructuring of the business unit Sports and functional food. Special efforts will be placed into listing and positioning of own brands into retail channel in Germany and Austria and on marketing activities on those markets. The management of Atlantic Grupa in 2017 expects significantly higher average prices of raw coffee in the global commodity markets and an unfavourable effect of the EURUSD exchange rate, which will influence the profitability of the Strategic business unit Coffee. The negative influence will be partially compensated by higher retail process of coffee, and partially by the higher profitability of other business units. (in EUR millions) 2017 Guidance /2016 Sales % EBITDA % EBIT % Interest expense 9 10 (17.0%) In 2017, we expect capital expenditure in the amount of around EUR 20 million. The expected effective tax rate in 2017 should be at the level of the previous year. STRATEGIC GUIDANCE FOR

22 BUSINESS UNITS

23 DISTRIBUTION

24 STRENGTH OF DISTRIBUTION Developed network with 18 distribution centers Direct access on over 60,000 sales points in SEE Over 1,000 delivery vehicles DISTRIBUTION 24

25 DISTRIBUTION ZONE WEST ZONE EAST Leading Distributor of Multinational Brands Atlantic Grupa is one of leading distributors of high-quality top FMCG brands (both own and principal) in SEE DISTRIBUTION 25

26 SBU COFFEE

27 STRENGTH OF TRADITION Barcaffè - over 45 years of tradition in Slovenia 8 out of 10 Slovenians drink Barcaffè Grand kafa - over 15 years brand No.1 in Serbia SBU COFFEE 27

28 20.8 % share in sales No. 1 in Turkish coffee in Serbia, Slovenia, B&H and Macedonia EUR 141m sales in 2016 SBU COFFEE 28

29 SBU SAVOURY SPREADS

30 ARGETA & MONTANA delicious meal for all occasions Manufacturer of high quality food brands Argeta savoury spreads, and Montana sandwiches with extended freshness SBU SAVOURY SPREADS 30

31 10.6 % share in sales No. 1 1 SPREADS BiH Slovenia Austria Macedonia No. 22 SPREADS Switzerland Serbia Croatia EUR 72m sales in th strongest FMCG brand in the region. Sold in 33 countries. SBU SAVOURY SPREADS 31

32 BU GOURMET

33 GRANNY S SECRET Produced at the base of Mount Kopaonik, protected ecological area Hand picked fruits and vegetables specially treated at very low temperatures in order to preserve all the nutrients BU GOURMET 32

34 0.6 % share in sales EUR 4m sales in 2016 Products for true connoisseurs 100% natural, finest grown and wild fruits and vegetables without preservatives, artificial colors or aromas Present in over 20 markets worldwide CATEGORIES: Ajvar (Roasted Red Pepper Spreads), Fruit Jams and Coulis, Fruit and Vegetable Juices BU GOURMET 33

35 SBU SNACKS

36 LEADING FMCG BRANDS IN THE REGION Over 28,000 tonnes of snacks produced in 2016 Flips No.1 in Serbia, B&H and Slovenia No.1 chocolate bars and wafers in Serbia Over 1 million fans on Facebook SBU SNACKS 35

37 Created in 1972, the first flips produced in SEE, Smoki has become the generic word for a group of flips products. A delightful dessert offers a wide selection of flavours and shapes. The famous soft chocolate foam dessert, first of its kind in the SEE region, is a product with more than 75 years of tradition. Biscuits and wafers that marked the youth of many generations. No. 1 SERBIA Flips Chocolate bars Wafers CROATIA, SLOVENIA, BiH Flips No. 2 SERBIA Chocolate tablets Biscuits Sticks 12.8 % share in sales EUR 87m sales in 2016 SBU SNACKS 36

38 SBU SPORTS AND FUNCTIONAL FOOD

39 MULTIPOWER Leading brand in Europe Production, R&D and sales of sports and functional food and healthy food Leading brand of sports nutrition in Europe and No.1 in dietetic products category in Germany 40 years of tradition SBU SPORTS AND FUNCTIONAL FOOD 38

40 No. 1 Sports food in Europe. 8.8 % share in sales EUR 60m sales in 2016 SBU SPORTS AND FUNCTIONAL FOOD 39

41 SBU BEVERAGES

42 SALES BY CATEGORIES SBU BEVERAGES 41 52

43 No. 1 Vitamin instant drink in Croatia, Slovenia and Serbia A cola drink that was born different 60 years ago. Unique blend of 11 herbs and aroma of dog rose. During its 40 years became synonym for the healthy multivitamin refreshment in the region. A natural multifunctional mineral water with a high level of magnesium and clinically proven effect % share in sales EUR 85m sales in 2016 SBU BEVERAGES 42

44 SBU PHARMA AND PERSONAL CARE

45 HEALTH AND BEAUTY CARE Encompasses 3 complementary activities: I. Farmacia pharmacy chain II. Food supplements and OTC products (Fidifarm and Dietpharm) III. Cosmetics (Neva) 10.2 % share in sales EUR 69m sales in 2016 Croatia s largest private chain of pharmacies and specialised shops for medicines and food supplements. Plidenta toothpaste has maintained its leading position on the Croatian market. An original Croatian universal cream. Renowned Croatian brand in the cosmetics. The leading regional producer of food supplements and vitamin products. SBU PHARMA AND PERSONAL CARE 44

46 No. 1 CROATIA Lip care Food supplements Dental care SERBIA and B&H Food supplements No. 2 CROATIA Body care SERBIA Lip care SBU PHARMA AND PERSONAL CARE 45

47 BU BABY FOOD

48 BEBI - FROM THE FIRST DAY OF LIFE No.1 in category of baby cereals in Ukraine No.1 in baby biscuits category in Lithuania BU BABY FOOD 47

49 2.3 % share in sales EUR 16m sales in 2016 BU BABY FOOD 48

50 Atlantic Grupa d.d. Miramarska Zagreb, HR T ir@atlanticgrupa.com